On Friday 22 November, Annalisa Prizzon and Dr. Amir Lebdioui joined us for a discussion on ‘A very light shade of green? Is the green transition perpetuating inequality?’ as part of the Cutting Edge Issues in Development Lecture Series for 2024. The discussant was Parth Bhatia and the chair was Dr Laura Mann. Read what MSc students Isabella South and Argjenta Svirca took away from the lecture below.

You can watch the lecture back on YouTube or listen to the podcast.

With discussions at this year’s COP in Baku over, it seems a very appropriate time to be discussing the future of a global green transition. What are the potential opportunities of a green transition? What are the potential risks? How can we ensure that no one gets left behind? These were some of the questions that panellists Annalisa Prizzon and Amir Lebdioui were trying to answer in last week’s Cutting-Edge Issues in Development lecture.

Amir kicked-off the lecture. In his new book, Survival of the Greenest, Amir argues that a green transition is more than just an ecological act, it is a matter of economic survival. A good example of this is Nauru, which was once one of the richest countries in the world thanks to its mineral deposits. However, after having extracted most of its minerals and failing to diversify its economy, Nauru has quickly become a very low-income country. Amir says this should be a ‘cautionary tale’ for other countries to follow a more sustainable trajectory of growth.

Amir argued that countries with pre-existing industrial capabilities have the best chance of joining green economy chains. Malaysia, for example, has leveraged its pre-existing industrial experience to  begin manufacturing solar cells, and is now one of the biggest exporters of solar cells in the world today.

Next, we heard from Annalisa, who interrogated the misconception that climate action is a threat to economic development. Annalisa argued that we should think less about the cost of climate action, and more about what the cost of climate inaction will be.

Annalisa suggests that Multilateral Development Banks (MDBs) can help aid a green transition. Not only are they major contributors to global international climate finance commitments, but they also have experience in implementing climate-related projects across countries. MDBs offer great value for money for their shareholders, but Annalisa believes some countries will be unwilling to pay more for a green transition.

Finally, Parth Bhatia, the discussant for the lecture, concluded by highlighting the growing digital gap between developed and developing countries. Advanced technologies, such as AI, are aiding the green transition in many countries. But Parth asks, are developing countries able to access the value that these technologies can bring? In Kicking Away the Ladder, Ha-Joon Chang argued that developed countries have been preventing developing countries from catching up with their economic growth. Now, Parth fears that a new ‘green ladder’ is being kicked away.

At the beginning of the lecture, Amir asked the audience to raise their hand if they believed a green transition would reduce global inequalities. The question was met with very few, very apprehensive hands being raised in the air.  It seems the response to Amir’s question reflects the current mood of uncertainty felt by many around the world today. Since the lecture, rich countries at this year’s COP have pledged $300 billion annually to help fight climate change. With many developing countries calling this a ‘weak, insulting deal’, it remains to be seen whether an inclusive, global green transition will actually be achieved.

Isabella South

While the nexus between climate and inequality might appear complex at first, it becomes increasingly evident that the green transition—while essential for addressing environmental degradation—can unintentionally worsen existing disparities.

With the current pace of climate change, environmental sustainability is no longer a choice but an imperative for countries striving to maintain a competitive edge in the global economy. In last week’s Cutting-Edge Issues in Development lecture, Dr. Lebdioui emphasized the need to abandon the “grow now, clean up later” mindset and to embrace the many opportunities countries have for environmental upgrading, a concept centered on creating value by reducing waste and increasing resource efficiency.

If there are opportunities for all, then why is change not happening? Dr. Lebdioui pointed out a significant issue in the renewable energy transition: despite the availability of technical solutions and increasing investments in renewable energy, access remains highly unequal. For example, while renewable energy investment per capita exceeds $100 in the USA and the EU, Sub-Saharan Africa receives only $1 per capita despite its pressing needs. This disparity indicates that energy investments are not driven by environmental considerations but by the perception of economic opportunity, enabling some countries to gain a competitive edge in the green transition. Finally, he pointed out that green economic transformation requires changes in the organizational structure of governments with greater coordination among government and non-government actors.

On the other hand, Prizzon offered practical insights into how countries can benefit from climate policies, particularly through the role of Multilateral Development Banks (MDBs). She argued that embarking on green economic transitions does not create trade-offs with the development agenda; rather, inaction on climate change undermines development efforts, hitting the poorest countries the most. However, she also recognized that many countries lack the incentive to take on debt for projects that address global issues. To mitigate this, MDBs must create more favorable lending terms and adapt to the specific needs of these countries. The need for reform within MDBs is further underscored by the unprecedented scale of national and global challenges, including climate change, pandemics, and security concerns, which demand not only financial support but also policy advice. However, she emphasized that MDBs remain key actors in supporting countries through this transition, leveraging their expertise in implementing large-scale climate-related projects, their commitment to aligning operations with the Paris Agreement, and their capacity to address transboundary challenges. To conclude, both speakers agreed that the challenge lies not in determining whether to integrate climate into the development agendas, but rather in how to do so without leaving anyone behind.

Argjenta Svirca

The views expressed in this post are those of the author and in no way reflect those of the International Development LSE blog or the London School of Economics and Political Science.

Featured image credit: LSE Department of International Development